Reporting thresholds: 2025 payments vs. 2026 payments
The 2025 tax law (Pub. L. 119-21) changed two thresholds, and they take effect in different years, which is the source of most confusion this season.
| Form | Payments made in 2025 (reported in early 2026) | Payments made in 2026 (reported in early 2027) | Payments made in 2027 (reported in early 2028) | Source |
|---|---|---|---|---|
| 1099-NEC (nonemployee compensation) | $600 or more | $2,000 or more | $2,100 or more | IRC 6041AIRC 6041AInternal Revenue Code, Cornell LII as amended; Rev. Proc. 2026-35 sec. 3.52 |
| 1099-MISC (rents, royalties, prizes, other income, medical, attorney payments) | $600 or more (royalties $10) | $2,000 or more (royalties unchanged at $10) | $2,100 or more (royalties $10) | IRC 6041IRC 6041Internal Revenue Code, Cornell LII as amended; Rev. Proc. 2026-35 sec. 3.52 |
| 1099-K (payment card and third-party network) | More than $20,000 and more than 200 transactions (the $600 phase-down was repealed retroactively) | More than $20,000 and more than 200 transactions | Same (not indexed) | IRC 6050WIRC 6050WInternal Revenue Code, Cornell LII as amended |
| 1099-INT / 1099-DIV | $10 or more ($600 for some interest) | Unchanged | Unchanged | IRC 6049IRC 6049Internal Revenue Code, Cornell LII, 6042 |
The 2027 amount is the first inflation adjustment of the $2,000 figure. Rev. Proc. 2026-35, section 3.52: “For payments made in calendar year 2027, the reporting threshold for payments described in § 6041(a) is $2,100.” The 1099-NEC rule in IRC 6041A(a)IRC 6041AInternal Revenue Code, Cornell LII and the backup withholding rule in IRC 3406(b)(6)IRC 3406Internal Revenue Code, Cornell LII both use “the dollar amount in effect for such calendar year under section 6041(a),” so the same $2,100 applies to them.
The IRS’s own chart agrees: its Guide to Information Returns (July 2026) lists Form 1099-NEC at $600 or more for payments made before 2026 and $2,000 or more for payments made in 2026, with the IRS and recipient due dates for every information return.
For the returns you file in January 2026, nothing has changed: $600 is still the NEC/MISC threshold for 2025 payments. The $2,000 threshold applies to what you pay in 2026, so vendors paid between $600 and $1,999 in 2026 will not need a 1099-NEC in January 2027. Keep collecting a W-9 from every vendor at onboarding regardless: in March you can't know which vendors will cross $2,000 by December, and the solicitation record is what protects you if one does.
Penalties for returns due in 2026
IRC 6721IRC 6721Internal Revenue Code, Cornell LII (the return filed with the IRS) and IRC 6722IRC 6722Internal Revenue Code, Cornell LII (the statement furnished to the payee) each carry the same per-return amounts, so one bad TIN usually costs twice the figure shown. Amounts per Rev. Proc. 2024-40.
| Correct return filed | Per return | Annual maximum | Annual maximum, small business* |
|---|---|---|---|
| Within 30 days of the due date | $60 | $683,000 | $239,000 |
| After 30 days, by August 1, 2026 | $130 | $2,049,000 | $683,000 |
| After August 1, 2026, or never | $340 | $4,098,500 | $1,366,000 |
| Intentional disregard | $680 or 10% of the amount required to be reported, whichever is greater | None | None |
Both penalties apply when the same wrong TIN is on the IRS return and the payee copy, and each is tiered by when the correct version is filed or furnished. A waiver for reasonable cause removes both. Amounts per Rev. Proc. 2024-40.
Returns due in 2027 (the 2026 forms you file in early 2027) use the amounts in Rev. Proc. 2025-32: the same $60 / $130 / $340 per return, intentional disregard $690, and higher annual maximums of $698,500 / $2,095,500 / $4,191,500 ($244,500 / $698,500 / $1,397,000 for small businesses). The what's coming for 2027 page tracks the rest.
Returns due in 2028 (the 2027 forms) use the amounts in Rev. Proc. 2026-35: $70 / $140 / $360 per return, intentional disregard $720 (or 10% of the amount required to be reported, if greater), and annual maximums of $721,000 / $2,163,500 / $4,327,500 ($252,000 / $721,000 / $1,442,500 for small businesses). The same amounts apply to payee statements under IRC 6722IRC 6722Internal Revenue Code, Cornell LII.
*Average annual gross receipts of $5 million or less for the three most recent tax years. Estimate a notice with the 972CG penalty estimator.
Backup withholding
| Item | 2026 | Source |
|---|---|---|
| Rate | 24% | IRC 3406(a)(1)IRC 3406Internal Revenue Code, Cornell LII |
| Applies to | Reportable payments to a payee with a missing TIN, an IRS-notified incorrect TIN (after the B-Notice period), an IRS under-reporting notice, or a failed W-9 certification | IRC 3406(a)IRC 3406Internal Revenue Code, Cornell LII; Pub 1281 |
| Threshold for 6041/6041A payments | Withholding applies once payments to the payee reach the reporting threshold ($600 for 2025 payments; $2,000 for 2026 payments; $2,100 for 2027 payments) | IRC 3406(b)(6)IRC 3406Internal Revenue Code, Cornell LII as amended |
| Deposits | EFTPS, on the same monthly/semiweekly schedule as employment taxes; under $2,500 for the year may be paid with Form 945 | Form 945 instructions |
| Annual return | Form 945, due February 2, 2026 (January 31 falls on a Saturday); February 10 if all deposits were made on time | Form 945 instructions |
| Shown to the payee | Box 4 (federal income tax withheld) of the 1099 | Form instructions |
Details in the backup withholding guide; compute an amount with the backup withholding calculator.
E-file and other filing rules
| Rule | 2026 | Source |
|---|---|---|
| Electronic filing required when | You file 10 or more information returns of any type in aggregate (W-2s, 1099s, 1095s and others counted together) | Treas. Reg. 301.6011-2Treas. Reg. 301.6011-2Treasury regulations, Cornell LII (T.D. 9972) |
| Where to e-file | IRIS (Information Returns Intake System) or FIRE for 1099 series; SSA Business Services Online for W-2 | IRS |
| Extension of time to file | Form 8809: automatic 30 days for most 1099s; not automatic for 1099-NEC or W-2 (hardship criteria only) | Form 8809 instructions |
| TIN Matching Program | Free; interactive 25 pairs per request; bulk 100,000 per file, results in 24 hours; enrollment via e-Services with 1099 filing history | Pub 2108A |
| W-9 revision | March 2024 revision (adds line 3b for flow-through entities with foreign owners); older forms on file remain valid | Form W-9 |
Due dates in 2026 (tax year 2025 returns)
When a due date falls on a weekend or legal holiday it moves to the next business day; January 31, 2026 and February 28, 2026 are Saturdays, March 15, 2026 is a Sunday.
| Form | To the recipient | To the IRS/SSA on paper | To the IRS/SSA electronically |
|---|---|---|---|
| 1099-NEC | February 2, 2026 | February 2, 2026 | February 2, 2026 |
| 1099-MISC | February 2, 2026 (February 17 if amounts in boxes 8 or 10) | March 2, 2026 | March 31, 2026 |
| 1099-INT, 1099-DIV, 1099-K, 1099-B*, others | February 2, 2026 (*February 17 for 1099-B and consolidated statements) | March 2, 2026 | March 31, 2026 |
| W-2 / W-3 | February 2, 2026 | February 2, 2026 | February 2, 2026 |
| 1042-S | March 16, 2026 | March 16, 2026 | March 16, 2026 |
| Form 945 (backup withholding) | n/a | February 2, 2026 (February 10 if deposits were timely and in full) | |
Notice deadlines
| Notice | Deadline | Source |
|---|---|---|
| CP2100 / CP2100A: send B-Notice | 15 business days from the notice date or receipt, whichever is later | Pub 1281 |
| CP2100 / CP2100A: begin backup withholding | No later than 30 business days after the notice date if no valid W-9 / validation received | Pub 1281 |
| Second B-Notice trigger | Same account listed twice within three calendar years | Pub 1281 |
| Notice 972CG: respond | 45 days from the notice date (60 if outside the U.S.) | Notice 972CG |
| Missing-TIN annual solicitations | By December 31 of the year opened (January 31 following if opened in December); by December 31 of the next year | Reg. 301.6724-1(e)Treas. Reg. 301.6724-1Treasury regulations, Cornell LII |
Work the dates out with the B-Notice deadline calculator and the solicitation deadline calculator.
Prior years, for late notices
A Notice 972CG received in 2026 usually covers returns due in 2025. Those amounts were $60 / $130 / $330 per return, $660 for intentional disregard, with maximums of $664,500 / $1,993,500 / $3,987,000 ($232,500 / $664,500 / $1,329,000 for small businesses), per Rev. Proc. 2023-34. Returns due in 2024: $60 / $120 / $310, $630 intentional. The backup withholding rate has been 24% since 2018.